Venture Capital - VC investment in three major new trend in the United States

Venture Capital - VC investment in three major new trend in the United States

Venture Capital three new trends: the increasing scale of venture capital, investment objectives turning to established companies, as well as pay more attention to outside the United States market.

1. Venture capital increasingly large scale According to VentureOne data published in 2006, the financing of the two funds were the largest from Oak Investment Partners and New Enterprise Associates, amount of financing were 2.56 billion U.S. dollars and 25 billion dollars. Overall, the 2006 financing of the scale of 5 billion dollars to one billion U.S. dollars of funds between the proportion of all funds of 12.1% over the 2005 doubled; financing scale for more than one billion U.S. dollars of funds at all the proportion of the fund was 4.4%, much higher than in 2005, 1.6%.

Venture One analyst about Shengeluofu (Josh Grove) said: "The growing scale of these funds, some small-scale fund gradually be eliminated. Some people even believe that those who invest in early stage companies mainly small-scale The Fund will form a 'vacuum'. "financing in 2006 the scale of 100 million U.S. dollars to fund the following percentage of all funds 34%, well below 2002's 71%. Medium-sized fund in 2006 amounted to 200.5 million U.S. dollars on average financing, while the 2004 was only 153 million.

This trend resulted in what kind of results? Some venture capitalists have begun to imitate private equity investor in established companies looking for high-growth opportunities, rather than as in the past to start from the bottom to help the start-up companies to recruit management, promotional products, and create a market. Venrock Associates Bryan Roberts, managing director (Bryan Roberts), said: "Some funds are actually rooted in a bubble, their business model more like a low-risk securities investment, rather than risk investment. If this situation continues, innovation will be inhibited. "

2. Small-scale fund exclusion In a sense, the emergence of this trend with the sluggish IPO market, as well as technology stocks continued to have a much lower relationship. With this same Venture capital, this also shows the strong trend in private capital investment in 2006, private capital investment totaling 660 billion U.S. dollars. At the same time making money in private equity, venture capital company would naturally prefer to be outdone. In addition to Oak Investment Partners and New Enterprise Associates, another three top five funds from Polaris Venture Partners, VantagePoint Venture Partners, and Sequoia Capital, financing, the amount of one billion U.S. dollars, respectively, 10 billion dollars and 861.5 million the United States yuan.

Go hand in hand in the top five venture capital firm, while others preached the size of the company's financing of the downward trend. For example, Charles River Ventures in 2004 financed 250 million U.S. dollars, down from 2001 to 450 million U.S. dollars; North Bridge Venture Partners in 2005 financed 500 million U.S. dollars, down from 2001 to 825 million U.S. dollars; US Venture Partners Finance Corporation in 2004 600 million U.S. dollars, down from 2001 to 10 billion U.S. dollars. Fund the expansion of the size of the increase also means that investment is currently one of the largest enterprises to the amount of venture capital is usually 20 million U.S. dollars to 5,000 million dollars, far higher than the previous one million U.S. dollars to 10 million U.S. dollars.

3. Investment objectives of the shift overseas

This trend does not mean that new companies can not attract investment. According to VentureOne data published in 2006, the emerging field of information services company, also based on user-generated content as the main business of the company received a total of 24 billion dollars in venture capital, compared to 2005 increased 27%. However, it is in the start-up companies is very difficult to find a winner, but a growing number of venture capital companies turning to outside the United States market. Even those who have dedicated funds for early stage technology companies, their investment scope is no longer limited to Silicon Valley.

Draper Fisher Jurvetson2007 years, the total amount of capital under management to 40 billion U.S. dollars, but includes 19 funds, with offices throughout many parts of Boston and Beijing. Under normal circumstances, regional manager of the company headquarters than those managers more easily find investment opportunities. Over the past two years, Draper Fisher Jurvetson of the most successful investments in the four pens, three pens from outside the United States market, investments are Baidu, eBay's Skype departments, as well as Focus Media.

4. Medium-sized living space is limited funds

Venture capital firm in China and India are making every effort to find those who lack funds, a more mature, but promising company. In this process, the medium-sized funds caught in a dilemma. Compared with the small-scale funds, they are not flexible enough; and large-scale funds, compared with their strength and not a small gap. For this reason, pension funds and donations to universities often choose to fund a large-scale or small-scale funds, medium-sized funds, no one is interested. In any case, the U.S. start-up companies to obtain the total amount of venture capital is still an upward trend. According to data released by Ernst & Young and VentureOne, 2006, U.S. companies received a total of 25.75 billion U.S. dollars venture capital, compared to 2005 increased 8%. Among them, mobile service provider Amp'd Mobile2007 financial year in April 150 million U.S. dollars, investors, including Intel and Qualcomm; online advertising agency Spot Runner2008 years in October received 40 million U.S. dollars venture capital investors including CBS and the Interpublic and so on.

More informations about Venture Capital:

Venture Capital -VC Introduction===>

Venture capitalist Venture capitalist can be roughly divided into the following four categories==>

What is a Venture Firm? ===>

Venture Capital-VC

Venture Capital - Introduction

What the Venture Capital?

Venture capital (VC) is invested by professional financiers to emerging and rapidly developing, and has great competitive potential of enterprises in a kind of equity capital. From the perspective of investment behavior, risk investment bears the risk of failure of capital to invest in high-tech research and development of the area and its products aimed at high-tech achievements as soon as possible to promote the commercialization, industrialization, in order to obtain a high capital gains investment process. From the works of view, is the talent management by professional investment intermediaries under the potential to be particularly high-tech businesses to invest in venture capital process, and also the coordination of venture capitalists, technology experts, investor relations, benefit-sharing, risk sharing an investment.

Venture Capital - the mode of operation Venture Capital

venture capital funds generally adopted manner.

Venture capital funds in the legal structure is to take the form of limited partnerships, and venture capital companies, as general partner to manage the Fund's investment operations and receive overtime pay. In the United States to take the risk of a limited partnership investment funds, get tax concessions, the Government in this way to encourage venture investment.

Venture Capital - 6 elements

Venture capital, venture investors, investment targets, investment horizon, investment objectives and investment constitute the six elements of venture capital.

, venture capital Venture capital is provided by professional investors and have a great appreciation of the rapid growth potential for a capital start-up companies. Venture capital through the purchase of equity, loans or both to buy stake in the form of loans also provides access to these enterprises. Sources of venture capital due to due to country-specific. In the United States in 1978, total venture capital financing of individuals and families accounted for 32%;

Followed by foreign funds, accounting for 18%; re-insurance companies funds, pension funds and large industrial companies, accounting for 16%, 15% and 10%, to 1988, the proportion of rapidly rising pension, accounting for 46% of total venture capital , followed by foreign funds, donations and public funds, and large companies fund industry, accounting for 14%, 12% and 11%, personal and family funds to account for a substantial proportion of drop only to 8%. Unlike the U.S., European countries, venture capital mainly from banks, insurance companies and pensions, respectively, the total venture capital for 31%, 14% and 13%, of which banks are the main source of venture capital in Europe, while individuals and families funds account for only 2%. In Japan, venture capital, as long as financial institutions and large companies from financial, accounting for 36% and 37%. Followed by foreign funds and securities company funds, each with 10 percent, while personal and family funds are only up to 7%. According to sub-investment, venture capital funds and direct investment is divided into two types of guarantee funds. The first is a way to enter the purchase of equity invested enterprises, mostly for private capital; while the latter in order to provide funding by way of security for the invested enterprises to help, and the mostly government funds.

Second, venture capitalist Venture capitalist can be roughly divided into the following four categories:
▲ A venture capitalists. They want to invest in other entrepreneurs, entrepreneurs, investors and other risks, they through the investment profit. But the difference is that venture capitalists are cast out of all of the capital all the property of their own, rather than entrusted to the management of capital.
▲ B venture capital firm. Types of venture capital companies there are many, but most companies through venture capital funds to invest in these funds generally limited partnership as a form of organization.
▲ C Industries subsidiary investment company. Such investment companies are often a number of non-financial industrial company under the independent venture capital firms, they represent the interests of the parent company to invest. Such Venture capital investors typically will mainly invest in specific industries. Like traditional venture capital, industrial investment company subsidiaries are also being invested enterprises must submit an assessment of investment proposals, in-depth company for due diligence and look forward to receive higher returns.
▲ D angel investors. Such investors typically invest in very young companies to help these companies a quick start. In the field of venture capital, "angel investors" the term refers to the first batch of entrepreneurs, investors, these investments were in the company's products and business put money into it before shaping. Third, investment purposes Although venture capital is an equity investment, but investment objective is not to obtain ownership of the business, not for holding, and certainly not to running the business, but by investing and providing value-added services to enterprises to make large investments, and then through a public offering ( IPO), mergers and acquisitions or other means to withdraw, in the property rights movement to achieve return on investment. Fourth, investment horizon Venture capitalist to help businesses grow, but they ultimately seek the withdrawal of channels will be invested in order to achieve proliferation. Venture capital has been invested enterprises from input to play until the withdrawal of investment by the length of time interval is called venture capital investment period. As an equity investment, venture capital over an extended period. Among them, Start-up venture capital usually 7 to 10 years, entered the mature stage, while the follow-up investments are mostly only a few years time.

5, investment target Venture capital industries are mainly high-tech industries. In the United States in 1992 on the computer and software accounted for 27%; followed by the health care industry, accounting for 17%; again is a communications industry, accounting for 14%; bio-tech industry accounted for 10%.

6, investment From the nature of the investment perspective, venture capital in three ways:
First, direct investment. But rather to provide loans or loan guarantees. 3 is to provide part of the loan or guarantee funds to invest at the same time as part of venture capital invested enterprises to purchase shares. But no matter what kind of investment, venture investors are generally included to provide value-added services. Venture Capital There are two different mode of entry. The first is the venture capital investment has been invested enterprises in stages, this situation is more common, not only can reduce the investment risk, and it helps to accelerate cash flow; the second is a one-time investment. This approach is not common, generally venture capitalists and angel investors may take this approach, one input, it's hard not the original follow-up financial support.


More informations about Venture Capital:

Venture Capital -VC Introduction===>

Venture capitalist Venture capitalist can be roughly divided into the following four categories==>

Venture Capital investment in three major new trend in the United States==>
What is a Venture Firm? ===>